This week, the Federal Reserve Board (Board) issued a supervisory letter identifying actions that Board-supervised banks should take when engaging in crypto-asset-related activities, according to a recent press release. The supervisory letter highlights potential risks associated with crypto-related ventures, including concerns about consumer protection, financial stability and technological security. Among other guidance, the letter provides that "prior to engaging in any crypto-asset-related activity, a supervised banking organization must ensure such activity is legally permissible and determine whether any filings are required under applicable federal or state laws." The letter further advises that supervised banks should have in place appropriate risk management systems and controls in order to conduct such activities safely and soundly, and that they must notify their lead supervisory point of contact at the Board in advance of engaging in any crypto-asset-related activity, or if already engaged, they must provide such notification promptly.
Also this week, Sen. Pat Toomey, a member of the U.S. Senate Banking Committee, issued a letter to the Federal Deposit Insurance Corporation (FDIC) seeking information about alleged obstruction of bank relations with crypto companies, according to a recent press release. Among other points raised in the letter, the FDIC is alleged to have delivered letters to regional offices requesting that banks refrain from expanding relationships with crypto companies, without providing a legal explanation for the request. Toomey also refers in his letter to whistleblower reports suggesting that the FDIC may be abusing its powers in an effort to deter banks from providing credit to crypto-related businesses. The senator has requested from the FDIC responses and documents addressing his inquiry by Aug. 30, 2022.
For more information, please refer to the following links:
- Federal Reserve Board provides additional information for banking organizations engaging or seeking to engage in crypto-asset-related activities
- Federal Reserve Board Supervisory Letter: Engagement in Crypto-Asset-Related Activities by Federal Reserve-Supervised Banking Organizations
- Whistleblower Reports Say FDIC Headquarters Improperly Stifling Crypto Business for Banks
- Senator Pat Toomey Letter to FDIC Regarding Deterring Banks from Doing Business with Crypto Companies
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